Business Category Business: career motivation and tips to move ahead

How to start a taxi business

Starting a taxi business does not have to be as hard as it seems. The business could cater to agencies that require rides for customers or employees to and from job locations. If the business is going to be for private clients, the business will still need some of the basic things, but the start up cost and fees will be less. The insurance is what is the most difficult to obtain for a taxi business. The community that the business will operate in is another consideration when starting the business as far as insurance and licenses are concerned.

Apply for the license to operate a taxi service. This takes the longest time. The other license needed is the license to drive a taxi. All drivers must have this permit.

Checking with insurance companies to find affordable insurance is going to take the longest time. In some states and local cities, the amount of insurance needed is very high resulting in high premiums. Shop around before committing to any insurance company.

Some insurance companies will require that the owner have the vehicles before the insurance is purchased. To start a taxi business, it is good to have at least three vehicles to transport customers. Make sure they are in top running condition and good on gas.

Communication radios should be installed in each vehicle for fast and prompt communications. A designated phone line for the dispatcher should be in the possession of the person designated as the dispatcher at all times. Many start up companies designate one driver as the dispatcher during the shift. This person communicates to the other drivers where to go while driving themselves.

Hire the drivers needed to run a 24/7 taxi business. These drivers need to have a permit to drive a taxi. Clean driving records are important when hiring drivers.


  • Always do a criminal check on potential drivers. Part of the job duty should be keeping the taxi clean.


  • Do not do anything that is prohibited according to the operating license. Keep up the maintenance on all vehicles or they can fail inspections.

Things Needed

  • Three vehicles to start
  • Taxi license to drive a taxi
  • Taxi license to operate a taxi business
  • Insurance
  • Designated phone line
  • Communication radios for all vehicles
  • Two or three licensed drivers